X hits on this document

24 views

0 shares

0 downloads

0 comments

5 / 8

Human Geography

Economic Geography

TNCs

LO: Discuss the characteristics of TNCs

Transnational corporations are firms with two or more branch plants across international boundaries

Global FDI Patterns

Selective and uneven

o

Japan’s FDI: USA, W. Europe and Asia

o

USA’s FDI: Canada, the UK, Australia and Latin America

Focused on regions: EU (W. Europe), Asia, America

Biased against the African continent

Singapore’s FDI: ASEAN, US, UK

The Maquiladora Effect

The Maquiladora refers to the cluster of US TNCs with manufacturing plants located at the US-Mexico border – creates uneven development in Mexico

Cluster of TNCs at the borders of two countries

o

Take advantage of low wages and land costs

Examples: Singapore-Johore border; Hong Kong-Shenzhen

Workings of a TNC

LO:Discuss the command and control relationship between TNCs and the host economy

Discuss the spatial organization, linkages and the social and economic impacts of TNCs on a specific host economy

Core – HQs, R&D: mainly in EMDCs

Semi-periphery – Regional HQs: mainly in NICs

Periphery – Manufacturing plants: mainly in ELDCs

Impacts of TNCs

LO:Analyze the social and economic impact of TNCs to the economies in which they operate

Effects of Outsourcing

Positive

Negative

Reduces capital inputs of setting up new plants and buying new machinery

Able to shift operations quickly in order to find the best, and most efficient contractor

Quality of products may be compromised, unless under strict QC

Unpredictability of employment of local labour

Possible to take advantage of confidential trade information, may lead to piracy problems

Case Study: Nike

Directly employs 23,000 workers

Outsources to 660,000 contract workers

Controversies with activist groups over poor working conditions in ELDCs

Branding with top sportspeople

Developments over the last four decades

Shift of manufacturing plants

o

70s – USA

o

80s – S. Korea, Taiwan

o

90s – Brazil, SE Asia, China

Global shifts due to changing labour costs

Changes in un/employment

Continued profits

Outsourcing practices

Outsources all manufacturing to contractors

Focus on core: R&D and marketing

High spatial mobility

5 of 7

Document info
Document views24
Page views24
Page last viewedThu Dec 08 14:37:33 UTC 2016
Pages8
Paragraphs459
Words2028

Comments